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Edited version of private advice
Authorisation Number: 1051950510696
Date of advice: 15 February 2022
Ruling
Subject: Prize - non-assessable windfall gain
Question
Is the prize you received assessable income?
Answer
No. The prize is not ordinary or statutory income and therefore is not assessable income under subsection 6-5(1), section 6-10 and subsection 15-2(1) of the Income Tax Assessment Act 1997. Having considered your circumstances and the relevant factors, the prize is a non-assessable windfall gain.
The prize was based on your lifetime scholarly research and is to honour your work over decades, rather than being granted in relation directly to or indirectly to, any employment of or services rendered by you. You did not solicit the prize nomination and it voluntarily arose by the prize giver.
Further information can be found in ATO Interpretive Decision ATO ID 2002/644 Assessability of Prize or on our website ato.gov.au and entering Quick Code QC 31936 into the search bar at the top of the page.
This private ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You are an Australian resident for taxation purposes.
In xx xx xxxx you received unexpected advice that you have been awarded a science prize.
You had no idea that you had been nominated for the prize by your overseas colleagues back in xxxx but due to COVID no award was made last year so your nomination was brought forward for the award for xxxx.
The prize consists of an amount of money.
You did not solicit the prize nomination and there is no connection between the payment and any ongoing employment obligations but it was awarded voluntarily by the prize giver.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 6-5
Income Tax Assessment Act 1997 subsection 6-5(1)
Income Tax Assessment Act 1997 section 6-10
Income Tax Assessment Act 1997 section 10-5
Income Tax Assessment Act 1997 subsection 15-2(1